China Has Stopped Buying U.S. Soybean Supplies, Bunge CEO Says05/03/2018
The world’s biggest oilseed processor just confirmed one of the soybean market’s biggest fears: China has essentially stopped buying U.S. supplies amid the brewing trade war.
In a move that caught many in U.S. agriculture by surprise, China last month announced planned tariffs on American shipments of soybeans. As the market waited for the measure to take effect, there was some hope among traders and shippers alike that relations between the nations could ease in the meantime and the trade flow would continue. But that doesn’t seem to be the case, at least for now, according to Bunge.
It’s “very clear” that the trade tensions have already stopped China from buying U.S. supplies, Schroder said. “How long that will last, who knows? But so long as there is this big cloud of uncertainty, that’s likely to continue.”
Price volatility in farm goods has picked up in recent weeks as the saber-rattling between the U.S. and China intensifies. Other agricultural products caught up in the dispute include corn, pork and sorghum. Soybeans are the second-largest American crop and prices are heavily dependent on trade with the Asian nation, the world’s top importer.
Bunge has still been able to meet Chinese demand by filling shipments with supplies from outside the U.S., Schroder said. The White Plains, New York-based company has a large presence in South America.